New Delhi: The Reserve Bank of India (RBI) has increased the policy repo rate by 25 basis points to 5.50 per cent from 5.25 per cent, marking the first hike in the benchmark rate since February 2023.
RBI Governor Sanjay Malhotra said the Monetary Policy Committee (MPC) unanimously voted in favour of the rate increase. He said economic conditions remain strong and that momentum in economic activity continues to be broad-based.
RBI Raises Repo Rate by 25 Basis Points
The MPC, headed by Governor Sanjay Malhotra, decided to raise the repo rate by 0.25 percentage points, taking it from 5.25 per cent to 5.50 per cent.
The repo rate is the interest rate at which the RBI lends money to banks. Changes in this rate can influence borrowing costs across the economy, including interest rates on loans.
Rate Hike Comes Amid Inflation and Oil Price Concerns
The latest decision comes against the backdrop of rising inflationary pressures, higher oil prices and a weaker rupee.
The RBI’s move marks a shift after keeping the benchmark rate lower following the previous rate hike in February 2023. The latest increase reflects the MPC’s unanimous decision to raise the policy interest rate to 5.50 per cent.
Disclaimer: This article is based on the information provided regarding the RBI’s monetary policy decision and is intended for general informational purposes only. Interest rates, inflation projections and monetary policy decisions may change based on economic conditions and future RBI announcements. Readers should refer to the RBI’s official communications for the latest information.